2023.02.0316:16:00UTC+00Upbeat Jobs Data Buoys U.S. Dollar

The U.S. dollar firmed against its major counterparts in the New York session on Friday, as the nation's job growth exceeded expectations in January, raising hopes that interest rates would remain elevated for longer.

Data from the Labor Department showed that non-farm payroll employment soared by 517,000 jobs in January after surging by an upwardly revised 260,000 jobs in December.

Economists had expected employment to increase by 185,000 jobs compared to the addition of 223,000 jobs originally reported for the previous month.

The report also said the unemployment rate edged down to 3.4 percent in January from 3.5 percent in December. The dip surprised economists, who had expected the unemployment rate to inch up to 3.6 percent.

The report from the Institute for Supply Management showed service sector activity rebounded by much more than expected in the month of January.

The ISM said its services PMI jumped to 55.2 in January from a revised 49.2 in December, with a reading above 50 indicating growth.

Economists had expected the index to inch up to 50.4 from the 49.6 originally reported for the previous month.

The USD/JPY pair advanced to a 2-day high of 129.98. The pair was worth 128.64 when it ended deals on Thursday. The greenback is seen finding resistance around the 134.00 mark.

The greenback appreciated to 1.2120 against the pound, a level unseen since January 12. The pound-greenback pair had finished yesterday's trading session at 1.2224. Next key resistance for the greenback is likely seen around the 1.19 level.

Final data from S&P Global showed that UK service providers reported another reduction in their business activity at the start of the year largely due to subdued spending by both businesses and consumers.

The Chartered Institute of Procurement & Supply services Purchasing Managers' Index fell to 48.7 from 49.9 in the previous month.

The USD/CHF pair climbed to a 3-day high of 0.9233. At Thursday's close, the pair was valued at 0.9131. The greenback is likely to face resistance around the 0.94 region, if it gains again.

The greenback was up against the euro, at a 3-day high of 1.0848. The pair had closed Thursday's deals at 1.0909. Should the greenback strengthens further, it is likely to test resistance around the 1.06 region.

Data from Eurostat showed that Eurozone producer price inflation eased for the fourth consecutive month in December to the lowest level in just over a year, as energy prices continued to rise at a slower rate.

The producer price index registered an annual increase of 24.6 percent after a revised 27.0 percent surge in November. Economists had forecast inflation to ease to 22.5 percent.

The greenback moved up to a fresh 2-week high of 0.6385 against the kiwi from yesterday's close of 0.6475. Continuation of the greenback's uptrend may lead it to a resistance around the 0.62 region.

The greenback strengthened to a 3-day high of 1.3421 against the loonie from Thursday's closing value of 1.3315. Further uptrend may take the greenback to a resistance around the 1.36 area.

The greenback jumped to an 11-day high of 0.6970 against the aussie from the previous close of 0.7076. Next near term resistance for the greenback is likely seen around the 0.68 level.